Analysts Just Published A Bright New Outlook For Micronics Japan Co., Ltd.'s (TSE:6871)

Celebrations may be in order for Micronics Japan Co., Ltd. (TSE:6871) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Investors have been pretty optimistic on Micronics Japan too, with the stock up 21% to JP¥7,260 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

Following the upgrade, the latest consensus from Micronics Japan's twin analysts is for revenues of JP¥52b in 2024, which would reflect a sizeable 36% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to leap 123% to JP¥239. Before this latest update, the analysts had been forecasting revenues of JP¥46b and earnings per share (EPS) of JP¥170 in 2024. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

See our latest analysis for Micronics Japan

With these upgrades, we're not surprised to see that the analysts have lifted their price target 82% to JP¥6,450 per share.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Micronics Japan's rate of growth is expected to accelerate meaningfully, with the forecast 36% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 9.3% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 12% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Micronics Japan to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Micronics Japan.

Analysts are definitely bullish on Micronics Japan, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including concerns around earnings quality. You can learn more, and discover the 1 other risk we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.